Professional Documents
Culture Documents
Emily U. Smith
Vice President
Neel M. Lund
Vice President
Price: $1,500
October 2009
New York San Francisco Boulder Denver Miami Dallas Chicago Washington DC Atlanta Boston Newport RI Vancouver Toronto Las Vegas
London Madrid Athens Moscow New Delhi Mumbai Dubai Beijing Singapore Hong Kong Shanghai So Paulo Buenos Aires Mexico City
Nassau, Bahamas
The 2009 publication of the HVI marks an unprecedented time for hotel
values. As markets fluctuated wildly throughout the past year and major
banking institutions folded, hotel demand dropped dramatically, and
average rates soon followed suit. The trend has continued into the summer,
rendering prior forecasts for a quick recovery defunct. To understand the
2009 HVI values and corresponding forecasts for each market, it is important
to understand the context in which the values have been derived.
The Hotel Valuation Index (HVI) tracks hotel values in 65 major markets and
the United States as a whole. Created in 1987 by HVS, the HVI is derived
from an income capitalization approach, utilizing market area data provided
by Smith Travel Research (STR) and historical operational information from
HVSs extensive global experience in hotel feasibility studies and valuations.
The HVI for 2009 is based on 2008 data; we note that each market has been
evaluated and forecast based on prevailing and anticipated trends specific to
that market.
The dizzying pace of declining hotel values has left industry participants in
limbo. When will it end? When will it recover, and by how much? How do
we even value hotels in todays uncertain times? Are the good times of recent
years past gone for good?
The following discussions help to provide the context for per-room values
forecast in the report. We first revisit the fateful consequences of the
crumbling banking system upon the U.S. economy, and government
attempts to plug the leak. We then analyze the impact of the recession upon
lodging demand and compare these trends to prior periods of recession.
Next, we look at how to value hotels in todays credit-dry environment. We
then present the 2009 HVI, with historical values, forecasts, and discussions
on notable markets. We also provide a guide to interpreting the HVI.
Page 1 of 49
Page 2 of 49
wealth, the implosion of the capital market lending system, and dramatic
reductions in consumer spending. 4
To combat the potential transformation of a deep recession into a depression,
the federal government resorted to lessons from the past, in re-committing
itself to a mammoth dose of the Keynesian brand of economics. In the fall of
2008, soon after the demise of Lehman Brothers, the federal government
injected $700 billion of public capital into the financial system, providing for
loans and loan guarantees for ailing banks. In the spring of 2009, beneficiaries
of such funds underwent critical stress tests to gauge their progression
towards fiscal stability. Moreover, President Obamas first actions upon
taking office in January 2009 included the infusion of an additional $787billion fiscal stimulus, in large part geared towards reviving the economy via
public works programs.
The question arises have such grand governmental efforts translated into
discernible improvement? On face value, certain recent successes can be
celebrated. On July 31, 2009, the federal government reported that the GDP
only contracted by approximately 1.0% in the second quarter. Such a decline
is largely attributable to lack of production, as businesses opted to service
new consumer orders through existing inventory.5 Consequently, an
exhaustion of existing inventory is expected to spur resumption of
manufacturing activity, thereby translating into the potential growth of the
GDP by as much as 3.0% in the third quarter of 2009.6 More recently, the
governments cash for clunkers program has helped markedly improve car
sales, resulting in warranted increases in production. Ironically, the chief
beneficiary of this program has been Japanese auto-maker, Toyota.
Nevertheless, General Motors and Chrysler have exited bankruptcy
proceedings with a directive towards streamlined and efficient future
operations. Moreover, with the aid of public capital and massive writedowns, U.S. investment banks for the most part have now begun to illustrate
signs of short-term profitability.
Upcoming Challenges
Despite such positive signs, the U.S. economic recovery effort faces the
following challenges:
Page 3 of 49
Page 4 of 49
Overall, most economists and market participants share the belief that the
U.S. economy will tread a stronger recovery path beginning in the latter half
of 2010. However, appropriately addressing the previously outlined
challenges remains integral to the timing and intensity of this anticipated
recovery.
10
Page 5 of 49
With the exception of the period from 1982 through approximately 1987
during which the GDP grew at a faster rate than lodging demand, historical
lodging demand trends have predominantly mirrored movements of the
national GDP. Thus, going forward, fluctuation in the GDP can be considered
a vital predictor of future hospitality demand levels.
Despite the disparity discussed above, HVS review and analysis of the last
four U.S. recessions results in the conclusion that the 1980-82 recession is
considered the most analogous to the current economic trough. This is
primarily due to the severity and duration of the early 80s recession and its
consequently prolonged impact on the U.S. lodging industry. In contrast, the
other previous U.S. recessions (1973, 1990-91, 2001-03) were short and
shallow.
Page 6 of 49
The 1980-82 recession was fueled by the energy crisis of 1979, and was
characterized by tight monetary policy to control rampant inflation. The
following illustrates its impact on hotel supply and demand.
1980-82 Recession Impact on U.S. Lodging Supply and Demand
Year
1979
1980
1981
1982
1983
1984
1985
1986
1987
Recession
Recession
Recession
Recession
Available
Room
Supply
(+000)
2,466
2,485
2,523
2,540
2,571
2,609
2,682
2,899
2,998
Change
in Supply
(%)
0.8 %
1.5
0.7
1.2
1.5
2.8
8.1
3.4
Daily
Hotel
Demand
(+000)
1,863
1,844
1,800
1,778
1,741
1,757
1,780
1,821
1,883
Change
in Demand
(+000)
(1.0) %
(2.4)
(1.2)
(2.1)
0.9
1.3
2.3
3.4
Prior to the 1980-82 recession, high interest rates inhibited sizeable supply
growth amidst the recessionary conditions. Moreover, as the national
economy recovered from the recession and the availability of financing
improved, supply illustrated noteworthy increases from 1985 through 1987.
More importantly, the preceding illustrates an extensive, four-year period of
consecutive declines in demand from 1980 through 1983. Such losses resulted
in a prolonged recovery period, as demand matched its 1979 high in 1987.
Based on the previously discussed state and outlook of the macroeconomic
landscape, the following illustrates historical and forecasted U.S. lodging
supply, demand, occupancy, average rate, and RevPAR from 2007 through
2015.
Page 7 of 49
Historical and Projected U.S. Lodging Supply, Demand, Occupancy, Average Rate, and RevPAR (2007-2015)
Year
Recession
Available
Room
Supply
(+000)
2007
2008
Recession
4,475
4,596
2.7
4,711
4,767
4,796
4,815
4,844
4,893
4,966
2.5
1.2
0.6
0.4
0.6
1.0
1.5
Forecast
2009
2010
2011
2012
2013
2014
2015
Recession
Recession
Change in
Supply
(%)
%
Daily
Hotel
Demand
(+000)
Change in
Demand
(%)
2,820
2,775
(1.6)
2,609
2,582
2,660
2,766
2,905
3,050
3,157
(6.0)
(1.0)
3.0
4.0
5.0
5.0
3.5
Change in
Occupancy
%
Occupancy
%
63.0
60.4
55.4
54.2
55.5
57.4
60.0
62.3
63.6
(4.1)
(8.3)
(2.2)
2.4
3.4
4.5
3.8
2.1
Average Rate
Change
in
Average
Rate %
$103.68
106.55
2.8
97.49
96.52
97.48
100.41
105.43
112.28
119.58
(8.5)
(1.0)
1.0
3.0
5.0
6.5
6.5
RevPAR
Change in
Average
Rate %
$65.32
64.36
(1.5)
54.01
52.31
54.10
57.64
63.26
69.95
76.05
(16.1)
(3.1)
3.4
6.5
9.8
10.6
8.7
Page 8 of 49
Page 9 of 49
Year
Number of
Hotels
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
288
234
222
254
196
323
312
605
522
485
447
357
Change
(%)
Number of
Rooms
Change
(%)
Average
Price per
Room
Change
(%)
(18.8) %
(5.1)
14.4
(22.8)
64.8
(3.4)
93.9
(13.7)
(7.1)
(7.8)
(20.1)
51,848
51,101
31,203
33,300
39,163
59,483
59,960
115,703
111,934
106,955
84,782
48,684
(1.4) %
(38.9)
6.7
17.6
51.9
0.8
93.0
(3.3)
(4.4)
(20.7)
(42.6)
$82,000
95,000
83,000
80,000
127,000
77,000
97,000
89,000
126,000
163,000
152,000
127,000
15.9 %
(12.6)
(3.6)
58.8
(39.4)
26.0
(8.2)
41.6
29.4
(6.7)
(16.4)
34,146
14,713
(56.9) %
$133,000
117,000
(12.0) %
Source: HVS
Page 10 of 49
Thus, over the next 12 to 18 months, the volume of hotel sales transactions is
expected to illustrate a progressively upward trend.
For referential purposes, the following table presents several of the largest
single-asset sales (in price per room) in 2008 and the year-to-date period
through July 2009.
Page 11 of 49
Major Hotel Sales 2008 and the Year-to-date Period through July 2009
Number of
Interest
Rooms
Date of Sale Conveyed
Price Paid
Price Per
Room
Property Name
City
State
Buyer
Seller
Confirmation
New York
New York
Los Angeles
New York
New York
Washington
Chicago
Herndon
Honolulu
Denver
New York
New York
New York
New York
California
New York
New York
D.C.
Illinois
Virginia
Hawaii
Colorado
New York
New York
139
45
728
200
56
355
192
216
1,230
189
146
124
4/1/2008
1/10/2008
6/2/2008
1/1/2008
1/14/2008
2/1/2008
9/17/2008
6/1/2008
6/1/2008
9/17/2008
10/1/2008
11/1/2008
Fee Simple
Fee Simple
Fee Simple
Leasehold
Fee Simple
Fee Simple
Fee Simple
Fee Simple
Fee Simple
Fee Simple
Fee Simple
Fee Simple
$82,000,000
24,750,000
366,500,000
99,000,000
25,000,000
141,300,000
76,120,000
78,000,000
410,000,000
61,830,000
46,340,000
39,060,000
$589,928
550,000
503,434
495,000
446,429
398,028
396,458
361,111
333,333
327,143
317,397
315,000
Andre Balazs
Hersha Development Corp.
Sunstone Hotel Investors, Inc.
57th Street Owner, LLC
Private Investor
Westbrook Partners/Northview Hotel Group, JV
Prudential Real Estate Investors
Ashford Hospitality Trust
Azabu Buildings Co, Ltd.
Prudential Real Estate Investors
McSam Hotel Group
McSam Hotel Group
Buyer
Buyer
Seller
Buyer
Confidential
Broker
Confidential
Broker
Broker
Confidential
Confidential
Confidential
Miami Beach
New York
New York
Las Vegas
San Francisco
Boston
Florida
New York
New York
Nevada
California
Massachusetts
13
298
244
2885
404
500
2/1/2009
2/25/2009
2/1/2009
3/20/2009
7/1/2009
2/1/2009
Fee Simple
Fee Simple
Fee Simple
Fee Simple
Fee Simple
Leasehold
$5,500,000
125,000,000
99,500,000
775,000,000
90,000,000
110,000,000
$423,077
419,463
407,787
268,631
222,772
220,000
Buyer
Confidential
Confidential
Seller
Seller
Seller
Page 12 of 49
Page 13 of 49
January 1, 2009
10 years
2012 based on 2012 property value
2018
Per-room value
The following details a pro forma for the example asset through the year of
stabilization (year seven). Beyond the stabilized year, net operating income is
presumed to increase annually at the assumed underlying rate of inflation
(3.0%).
13
Suzanne R. Mellen, Hotel Capitalization Rates on the Rise, HVS Global Hospitality
Report, January 2009.
Page 14 of 49
2009
58%
$103.51
2010
57%
$102.47
2011
57%
$102.98
2012
58%
$106.07
2013
60%
$111.38
2014
62%
$118.62
2015
63%
$126.33
Revenues
Rooms
Food
Beverages
Telephone
Rentals and Other Income
Total Revenue
$(000)
Percent
$21,800
65.8%
$7,566
22.8%
$1,742
5.3%
$397
1.2%
$1,616
4.9%
$33,121
100.0%
$(000)
Percent
$21,319
64.8%
$7,724
23.5%
$1,780
5.4%
$405
1.2%
$1,655
5.0%
$32,883
100.0%
$(000)
Percent
$21,500
64.3%
$7,976
23.9%
$1,837
5.5%
$418
1.3%
$1,707
5.1%
$33,438
100.0%
$(000)
Percent
$22,494
64.4%
$8,310
23.8%
$1,912
5.5%
$437
1.3%
$1,771
5.1%
$34,924
100.0%
$(000)
Percent
$24,311
65.1%
$8,743
23.4%
$2,007
5.4%
$461
1.2%
$1,850
5.0%
$37,372
100.0%
$(000)
Percent
$26,800
66.0%
$9,239
22.8%
$2,116
5.2%
$490
1.2%
$1,938
4.8%
$40,583
100.0%
$(000)
Percent
$29,188
66.9%
$9,677
22.2%
$2,212
5.1%
$515
1.2%
$2,019
4.6%
$43,611
100.0%
Departmental Expenses
Rooms
Food & Beverages
Telephone
Rentals and Other Income
Total Departmental Expenses
$6,051
$7,341
$360
$969
$14,721
27.8%
78.9%
90.7%
60.0%
44.4%
$6,204
$7,532
$369
$996
$15,101
29.1%
79.3%
91.1%
60.2%
45.9%
$6,399
$7,767
$380
$1,026
$15,572
29.8%
79.2%
90.9%
60.1%
46.6%
$6,630
$8,039
$394
$1,061
$16,124
29.5%
78.6%
90.2%
59.9%
46.2%
$6,905
$8,356
$410
$1,100
$16,771
28.4%
77.7%
88.9%
59.5%
44.9%
$7,208
$8,703
$427
$1,143
$17,481
26.9%
76.6%
87.1%
59.0%
43.1%
$7,491
$9,030
$444
$1,184
$18,149
25.7%
76.0%
86.2%
58.6%
41.6%
Departmental Income
$18,400
55.6%
$17,782
54.1%
$17,866
53.4%
$18,800
53.8%
$20,601
55.1%
$23,102
56.9%
$25,462
58.4%
$2,972
$2,420
$1,728
$1,445
$8,565
9.0%
7.3%
5.2%
4.4%
25.9%
$3,052
$2,485
$1,775
$1,487
$8,799
9.3%
7.6%
5.4%
4.5%
26.8%
$3,147
$2,562
$1,829
$1,532
$9,070
9.4%
7.7%
5.5%
4.6%
27.1%
$3,254
$2,649
$1,892
$1,580
$9,375
9.3%
7.6%
5.4%
4.5%
26.8%
$3,376
$2,749
$1,963
$1,632
$9,720
9.0%
7.4%
5.3%
4.4%
26.0%
$3,509
$2,857
$2,040
$1,686
$10,092
8.6%
7.0%
5.0%
4.2%
24.9%
$3,636
$2,961
$2,114
$1,740
$10,451
8.3%
6.8%
4.8%
4.0%
24.0%
$9,835
29.7%
$8,983
27.3%
$8,796
26.3%
$9,425
27.0%
$10,881
29.1%
$13,010
32.1%
$15,011
34.4%
Fixed Charges
Management Fee
Property Tax
Insurance
Reserve for Replacement
Total Fixed Charges
$994
$1,765
$742
$994
$4,495
3.0%
5.3%
2.2%
3.0%
13.6%
$986
$1,802
$764
$986
$4,538
3.0%
5.5%
2.3%
3.0%
13.8%
$1,003
$1,858
$787
$1,003
$4,651
3.0%
5.6%
2.4%
3.0%
13.9%
$1,048
$1,937
$810
$1,048
$4,843
3.0%
5.5%
2.3%
3.0%
13.9%
$1,121
$2,036
$835
$1,121
$5,113
3.0%
5.4%
2.2%
3.0%
13.7%
$1,217
$2,170
$860
$1,217
$5,464
3.0%
5.3%
2.1%
3.0%
13.5%
$1,308
$2,236
$885
$1,308
$5,737
3.0%
5.1%
2.0%
3.0%
13.2%
Net Income
$6,675
16.1%
$5,556
13.5%
$5,181
12.4%
$5,728
13.1%
$7,210
15.4%
$9,433
18.6%
$11,593
21.3%
Page 15 of 49
Valuation Input
LTV 50%
Valuation Output
Loan/Value
Amortization
Term
Interest Rate
Terminal Cap Rate
Transaction Costs
Equity Yield
50%
25 years
10 years
7.50%
10.00%
2.00%
19.00%
Value
Overall Discount Rate
Mortgage
Mortgage Constant
Debt Service
$72,700
15.20%
$36,350
0.0887
$3,225
Valuation Input
LTV 70%
Valuation Output
Loan/Value
Amortization
Term
Interest Rate
Terminal Cap Rate
Transaction Costs
Equity Yield
70%
25 years
10 years
7.00%
10.00%
2.00%
19.00%
Value
Overall Discount Rate
Mortgage
Mortgage Constant
Debt Service
$108,500
12.30%
$75,950
0.0848
$6,442
Page 16 of 49
Year
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
Net Income
Available for
Debt Service
$6,675
5,556
5,181
5,728
7,210
9,433
11,593
11,940
12,298
12,667
Total
Annual
Debt Service
$3,225
3,225
3,225
3,225
6,442
6,442
6,442
6,442
6,442
6,442
Plus:
Refi/Sales
Proceeds
$41,104
60,271
Total
Cash Flow
to Equity
$3,450
2,331
1,956
43,606
768
2,991
5,498
5,856
6,225
66,496
Present
Worth of
$1 at 19%
0.8403
0.7062
0.5934
0.4987
0.4195
0.3521
0.2960
0.2487
0.2090
0.1756
Discounted
Cash Flow
$2,988
1,646
1,161
21,745
322
1,053
1,524
1,367
1,224
11,676
$44,619
$36,369
$80,998
$81,000
14
Suzanne R. Mellen, Hotel Capitalization Rates on the Rise, HVS Global Hospitality
Report, January 2009.
Page 17 of 49
Valuation Comparison
Page 18 of 49
Prior to the 2008 version of the HVI, we had indexed the 1987 value of a
typical U.S. hotel (1987 = 1.0000) as a base. Beginning in last years version,
we have utilized 2005 as the base year. Thus, each market area is indexed off
the 2005 U.S. base, with a number showing the value relationship of that
market area to the base. For example, in 2005, the index for New York, New
York, was 3.857, which means that the value of a hotel located in New York
was approximately 386% higher than that of a similar hotel in the U.S. as a
whole in 2005.
Another useful comparison highlights the value differences between hotels in
two different U.S. cities. For example, say that a hotel in Philadelphia,
Pennsylvania, sold in 2008 for $100,000 per room. If a similar hotel were
situated in New York, it would probably have sold for roundly $469,000 per
room in 2008. This figure is calculated by taking the 2008 HVI for New York,
and dividing it by the 2008 HVI for Philadelphia to determine the value
adjustment.
2008 HVI New York (5.590) / 2008 HVI Philadelphia (1.191) = 4.6935
The 2008 sales price of $100,000 per room is then multiplied by the amount of
the previously calculated factor of 4.6935, yielding the estimated 2008 sales
price per room for New York.
$100,000 x 4.6935 = $469,350
To calculate the percentage change of hotel values in the same markets at
different points in time using the HVI, divide the HVI for the last year by the
HVI for the first year, and then subtract 1 from this calculation. For example,
in 2006, the HVI for Miami was 2.789, and in 2008, the HVI for this city was
3.042. To calculate the estimated percentage change in value for a typical
Miami hotel from 2006 to 2008, divide the 2008 HVI of 3.042 by the 2006 HVI
of 2.789, and then subtract 1 to get an approximate 9% increase in value from
2006 to 2008.
(3.042/2.789) 1 = 0.0907, or roundly 9%
Page 19 of 49
2009 HVI
In 2008, the value of a typical full-service hotel in the United States declined
by roundly $14,000 per room, or approximately 14.6%. The per-room value
for the United States as a whole reached its peak in 2006, surpassing $100,000.
Since that time, the per-room value has tumbled, and is forecast to reach half
its peak amount in 2010. These trends have been prompted by significant
declines in all forms of travel, which have in turn severely impacted net
income, as hoteliers have drastically reduced average rates in an effort to
boost occupancy levels. Combined with stringent credit availability and
terms, the effect upon hotel values is significant. While per-values will remain
suppressed in the near term, the overall market should recover in 2013-2014.
The following table illustrates historical and forecast per-room values for a
typical U.S. hotel.
Historical and Projected United States Per-Room Hotel Values
United States
2005
2006
2007
2008
2009
2010
2011
2012
2013
$82,416
25.4%
$100,065
21.4%
$95,117
-4.9%
$81,196
-14.6%
$55,132
-32.1%
$50,060
-9.2%
$57,069
14.0%
$75,102
31.6%
$93,127
24.0%
Page 20 of 49
Year
1991
1995
2000
2001
2002
2003
2004
2005
2006
2007
2008
Number of
Markets
50
2
15
64
31
37
8
4
4
44
61
While the data for 2008 is indeed ominous, some markets actually
experienced increases in per-room value in 2008, in comparison to 2007. The
biggest per-room gain in value occurred in New Orleans, where value
increased over 20%. Per-room value in New Orleans declined nearly 40% in
2007, due to the continued effects of Hurricane Katrina in the area, as
recovery efforts have been slow, and rebuilding of industry and tourism has
been gradual. New Orleans economy improved in 2008; the city is heavily
dependent on the oil industry, which recorded high profits in 2008. Hotel
demand has also been boosted by continual construction projects in the area.
Similarly, Houston experienced a strong per-room value increase in 2008, as
the Energy Capital of the World continued to benefit from the presence of a
multitude of energy companies in the area. Houstons reputation as a leading
healthcare center also boosted growth in demand. Pittsburgh, Buffalo, and
San Francisco completed the top five markets, in terms of per-room value
increases in 2008. Pittsburgh was one of the few cities that added jobs in 2008;
the citys economy has diversified since its manufacturing days, and the city
was ranked as Americas Most Livable City by The Economist in 2009. The only
other market that experienced an increase in per-room value in 2008, albeit
marginal, was Portland, Oregon.
The greatest percentage declines in per-room value vastly outpaced the gains
made by the top five winners mentioned previously. These five declining
markets have been plagued by dwindling industries, such as the textile and
tobacco industries in Greensboro, as well as the collapse of the housing
Page 21 of 49
market, such as in West Palm BeachBoca Raton. Las Vegas building frenzy
finally caught up with the city in 2008, as huge casino hotels opened to a
diminishing number of visitors. Moreover, the fallout from lavish corporate
spending and incentive meetings caused Las Vegas to be blacklisted among
meeting planners; as consumer confidence and spending dwindled, so has
leisure travel to perceived lavish destinations, such as Las Vegas.
Tallahassee experienced nearly a 50% decline in per-room value in 2008, in
comparison to 2007. While the local economy has remained relatively stable,
boosted by the presence of state government and two major universities, the
citys financial profile has continually deteriorated, due to deficit spending
and the inability to generate sufficient revenues.
Major Winners and Losers in 2008
Market
New Orleans
Houston
Pittsburgh
Buffalo
San Francisco
WPB-Boca Raton
Las Vegas
Norfolk
Greensboro
Tallahassee
2008
21%
20%
11%
9%
5%
-29%
-29%
-40%
-46%
-49%
Some of the most iconic American cities (New York, San Francisco, Boston,
and Washington, D.C.) have historically achieved the highest per-room
values throughout the years, and are projected to continue to do so over the
next five years. Other cities and regions have lost ground in comparison with
other markets, such as Stamford, Connecticut, and Long Island, New York,
both of which represent mature, saturated markets with little development
potential. Going forward, Las Vegas is projected to lose its Top Ten status,
due to the economic conditions described previously. Newcomers such as
Houston and Seattle are poised to experience strong growth in per-room
values, due to growing industries and development potential.
Page 22 of 49
The following table presents the top ten markets in terms of per-room value
as of 2000 and 2006, as well as forecasts for 2010 and 2013.
Top Ten Markets through the Years
2000
1
2
3
4
5
6
7
8
9
10
San Francisco
New York
Boston
San Jose
Long Island
Oahu
Washington DC
San Diego
Chicago
Stamford
2006
$329,000
302,000
294,000
237,000
191,999
169,000
168,000
159,000
153,000
152,000
New York
Oahu
Washington DC
San Francisco
San Diego
Miami
Boston
Las Vegas
Chicago
Los Angeles
2010
$382,000
356,000
242,000
242,000
232,000
230,000
216,000
201,000
199,000
196,000
Washington DC
New York
San Francisco
Boston
Oahu
Miami
San Diego
WPB - Boca Raton
Houston
Los Angeles
2013
$312,000
304,000
266,000
217,000
211,000
189,000
186,000
170,000
160,000
137,000
New York
Washington DC
Boston
San Francisco
Oahu
Miami
San Diego
WPB - Boca Raton
Seattle
Houston
$475,000
450,000
375,000
368,000
334,000
313,000
289,000
253,000
248,000
246,000
Source: HVS
In general, 2006 marked the year that per-room hotel values in most of the
markets reached their peak during the historical period reviewed. The
following table presents the changes in value for the top ten and bottom ten
markets from the peak levels achieved in 2006, through the projected perroom values for 2013. The United States ranking is also provided to facilitate
a comparison.
Page 23 of 49
Rank
Washington, D.C.
Boston
Houston
San Francisco
New York
Denver
San Jose
Miami
Portland
Austin
51 United States
$209,000
159,000
141,000
126,000
93,000
88,000
85,000
83,000
81,000
74,000
Indianapolis
Dayton
Jacksonville
Sacramento
Oahu
Phoenix
Greensboro
Detroit
Tallahassee
Las Vegas
($14,000)
(14,000)
(19,000)
(20,000)
(22,000)
(25,000)
(30,000)
(32,000)
(44,000)
(103,000)
($7,000)
Rank
1
2
3
4
5
6
7
8
9
10
57
58
59
60
61
62
63
64
65
66
Rank
Houston
Huntsville
Columbia
Washington, D.C.
Boston
Portland
Denver
Pittsburgh
San Jose
St. Louis
53 United States
134.5%
89.5%
89.5%
86.3%
73.6%
72.2%
70.8%
67.9%
64.1%
59.5%
57
58
59
60
61
62
63
64
65
66
Orlando
Phoenix
Indianapolis
Jacksonville
Sacramento
Dayton
Greensboro
Las Vegas
Detroit
Tallahassee
-10.4%
-14.8%
-15.3%
-15.6%
-18.6%
-32.8%
-47.7%
-51.2%
-54.1%
-61.7%
-6.9%
Source: HVS
The following tables present the historical and projected estimates for the
Hotel Valuation Index. We note that since the 2008 version, we have
amended the base year from 1987 to 2005. Therefore, a typical hotel in the
United States, which was previously indexed 1.000 in 1987, has now been
indexed at 1.000 in 2005. For informational purposes, we have presented HVI
results between 1987 and 2004, then from 2005 to 2008, plus a forecast for
2009. The HVI also shows the Compounded Annual Growth Rate (CAGR).
Page 24 of 49
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
CAGR
2004 (1987 - 2004)
Albuquerque
Anaheim
Atlanta
Austin
Baltimore
Boston
Buffalo
Charlotte
Chicago
Cincinnati
Cleveland
Columbia
Dallas
Dayton
Denver
Detroit
Fort Lauderdale
Greensboro
Hartford
Houston
Huntsville
Indianapolis
Jacksonville
Kansas City
Las Vegas
Long Island
Los Angeles
Memphis
Miami
Milwaukee
Minneapolis
Nashville
New Haven
1.194
1.364
1.321
0.437
1.717
2.612
1.384
1.096
1.663
1.167
0.821
0.891
0.933
1.193
0.807
1.414
1.087
0.611
2.183
0.538
0.603
1.153
0.808
1.057
1.030
3.820
1.652
0.821
0.597
0.955
1.050
1.387
1.958
1.245
1.317
1.198
0.423
1.374
2.750
1.257
1.094
1.644
1.199
0.909
0.748
0.992
0.996
0.768
1.136
0.965
0.705
1.952
0.763
0.635
1.035
0.755
1.090
1.099
2.891
1.585
0.611
0.786
1.015
0.833
1.141
1.761
1.460
1.313
1.155
0.603
1.326
2.334
1.506
1.019
1.426
1.134
0.928
0.760
1.215
1.018
0.734
0.871
1.015
0.685
1.676
0.881
0.615
1.059
0.842
1.001
1.164
2.437
1.586
0.633
0.940
0.928
0.711
1.140
1.482
1.461
0.963
1.045
0.639
0.907
2.505
1.465
0.700
1.463
1.068
0.733
0.615
1.109
0.633
0.885
0.510
0.936
0.460
1.480
1.014
0.483
0.854
0.705
0.763
1.292
1.463
1.626
0.538
1.191
0.879
0.637
0.990
1.043
1.538
0.763
1.045
0.768
0.748
1.799
1.472
0.499
1.303
0.982
0.639
0.572
1.155
0.557
0.988
0.304
0.744
0.312
0.640
1.127
0.510
0.903
0.569
0.657
0.831
0.916
1.016
0.595
1.294
0.707
0.863
0.937
0.621
1.615
0.656
1.195
1.031
0.867
1.987
1.211
0.560
1.348
1.056
0.701
0.745
1.403
0.590
1.182
0.410
1.479
0.680
0.497
1.126
0.605
1.019
0.796
0.795
0.922
0.879
0.617
0.668
2.289
0.692
1.167
1.135
0.531
1.804
0.781
1.631
1.365
0.996
2.412
1.102
0.668
1.660
1.073
0.898
0.836
1.564
0.685
1.547
0.557
1.255
1.004
0.425
1.165
0.453
1.171
0.992
1.108
1.386
1.074
0.501
0.968
2.024
0.777
1.398
1.337
0.594
1.769
0.692
1.963
1.642
1.284
3.177
1.055
0.950
2.225
1.201
1.195
0.905
1.955
0.706
1.772
0.931
1.020
1.296
0.573
1.198
0.354
1.356
1.175
1.313
2.065
1.383
0.921
1.280
0.906
0.858
1.689
1.712
0.649
1.676
1.057
2.409
2.351
1.600
4.019
1.115
1.280
2.663
1.323
1.667
1.163
2.421
0.840
2.120
1.257
1.377
1.498
0.886
1.355
0.381
1.681
1.517
1.659
2.438
1.802
0.970
1.444
1.863
1.008
1.995
2.112
0.930
1.507
1.318
2.700
2.257
1.859
4.651
1.142
1.642
3.170
1.435
1.625
1.283
2.606
0.809
2.391
1.382
1.669
1.162
1.118
1.443
0.464
1.697
1.830
1.823
3.325
2.059
1.338
1.419
2.174
0.973
1.961
2.103
1.080
1.478
1.643
2.190
2.461
2.346
6.334
1.328
1.889
4.005
1.591
1.885
1.395
2.824
0.988
2.831
1.543
2.220
1.285
1.531
1.952
0.836
1.863
2.133
2.007
3.245
2.665
2.095
1.655
2.863
1.162
2.260
2.366
1.532
1.083
1.560
2.184
2.394
2.496
6.485
1.183
1.852
3.996
1.491
1.710
1.078
2.736
1.103
2.585
1.678
2.035
1.509
1.701
2.057
0.537
1.551
1.820
1.757
2.886
3.205
2.475
1.509
2.856
1.210
2.240
1.880
1.686
0.937
1.577
2.241
2.406
2.758
6.830
1.283
1.849
4.003
1.447
1.627
1.092
2.424
1.058
2.179
1.929
2.209
1.355
2.016
1.699
0.659
1.439
1.785
1.537
3.101
3.963
2.674
1.256
3.299
1.212
2.082
1.712
1.901
1.036
2.118
2.234
2.955
3.264
7.880
1.347
1.558
4.098
1.353
1.536
1.104
2.493
1.069
2.318
2.052
2.336
1.421
2.354
1.828
0.693
1.734
1.958
1.493
3.996
5.117
3.267
1.064
3.403
1.315
2.277
1.616
2.178
0.904
2.157
1.717
1.960
2.871
5.169
1.121
0.986
2.650
0.918
1.034
0.965
1.554
0.817
1.772
1.430
2.037
1.100
1.985
1.857
0.641
1.544
1.767
1.266
3.421
4.494
2.460
0.889
2.363
0.966
1.767
1.228
1.994
0.995
1.960
1.600
1.532
3.301
4.402
1.170
1.049
2.405
1.055
0.912
1.180
1.442
0.917
1.575
1.127
1.742
1.239
1.758
1.703
0.961
1.573
1.970
1.258
3.651
3.911
2.349
0.978
1.638
1.074
1.676
1.378
2.030
0.948
2.251
1.333
1.325
3.331
3.050
1.069
1.016
2.456
1.136
0.776
1.168
1.195
1.037
1.378
0.921
2.124
1.334
1.367
1.231
1.006
1.557
2.331
0.985
4.984
3.724
2.448
0.937
2.098
1.118
1.450
1.550
1.669
0.990
2.871
1.736
1.415
3.671
4.318
0.999
1.203
2.669
1.374
0.977
1.611
1.504
0.940
1.668
1.081
3.151
1.306
1.846
1.442
1.133
1.896
2.675
1.238
6.167
3.617
3.639
1.199
3.504
1.204
1.892
1.801
1.799
(1.1) %
4.5
1.6
7.2
4.6
3.0
(1.9)
0.6
2.8
1.0
1.0
3.5
2.8
(1.4)
4.4
(1.6)
6.5
4.6
(1.0)
6.0
3.8
3.0
7.3
0.9
11.1
(0.3)
4.8
2.3
11.0
1.4
3.5
1.5
(0.5)
Page 25 of 49
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
CAGR
2004 (1987 - 2004)
New Orleans
New York
Norfolk
Oahu
Oakland
Omaha
Orlando
Philadelphia
Phoenix
Pittsburgh
Portland
Raleigh-Durham
Richmond
Rochester
Sacramento
Salt Lake City
San Antonio
San Diego
San Francisco
San Jose
Santa Fe
Seattle
St. Louis
Stamford
Syracuse
Tallahassee
Tampa
Tucson
United States
Washington, D.C.
Wilmington
Winston-Salem
WPB-Boca Raton
1.183
1.339
1.569
2.235
1.241
0.224
1.797
1.942
1.415
1.162
1.148
1.008
1.409
1.792
1.025
1.143
0.856
2.088
2.767
1.503
1.888
1.438
0.768
1.835
1.420
0.330
0.667
1.076
1.000
1.999
1.850
1.228
1.085
1.537
1.422
1.375
2.517
1.193
0.351
1.890
1.534
1.135
1.096
1.438
0.814
1.316
1.740
0.959
1.340
1.206
1.836
2.513
1.614
2.375
1.594
0.778
1.853
1.527
0.373
0.695
1.144
0.990
1.970
2.197
1.192
0.977
1.589
1.392
1.272
3.095
1.216
0.486
2.369
1.232
1.598
1.233
1.729
0.705
1.263
1.708
0.914
1.492
1.423
1.810
2.391
1.788
3.090
1.916
0.745
1.659
1.716
0.405
1.011
1.341
1.017
1.997
1.586
1.371
0.996
1.593
0.964
0.850
3.925
0.978
0.467
2.154
0.905
1.398
1.130
1.703
0.576
1.130
1.536
0.799
1.508
1.316
1.301
2.871
1.505
3.275
1.886
0.699
1.369
1.715
0.546
0.990
1.219
0.858
1.770
0.975
1.121
0.426
1.647
0.804
0.733
3.236
0.923
0.357
1.834
0.619
1.196
1.065
1.841
0.527
0.910
1.608
0.734
1.547
1.422
1.292
2.400
1.216
3.232
1.796
0.659
1.155
1.360
0.430
0.928
1.185
0.737
1.517
0.546
0.983
0.364
2.053
0.670
0.761
3.773
0.958
0.309
2.129
0.560
1.413
1.209
1.728
0.789
0.967
1.233
0.973
1.747
1.911
1.320
2.426
1.155
3.667
1.804
0.767
0.941
1.251
0.449
0.907
1.323
0.796
1.729
0.508
1.413
0.942
2.079
0.804
0.750
2.777
0.835
0.492
1.986
0.728
1.984
1.272
1.906
0.978
0.974
1.053
1.113
2.072
2.272
1.154
2.807
1.198
4.598
1.931
0.930
1.150
1.113
0.590
0.933
1.737
0.878
2.260
0.374
1.579
1.433
2.621
0.536
0.792
3.137
0.940
0.509
1.929
1.116
2.599
1.462
1.994
1.145
1.011
0.808
1.244
2.251
2.190
1.351
3.259
1.499
3.659
2.118
1.136
1.157
1.021
0.622
0.967
1.879
1.004
2.229
0.458
1.385
1.368
3.021
1.442
0.968
4.343
1.309
0.856
2.244
1.425
3.285
1.483
2.509
1.689
1.151
1.116
1.496
2.510
2.231
1.762
4.154
2.281
3.352
2.722
1.324
1.525
1.124
0.833
1.109
2.417
1.207
2.769
0.734
1.625
1.668
2.990
2.898
0.918
4.499
1.801
0.840
2.916
1.905
3.568
1.587
2.709
2.153
1.344
0.967
1.388
3.007
1.994
2.089
5.167
3.201
2.827
2.990
1.338
2.139
1.050
0.791
1.405
2.431
1.348
2.732
1.028
1.514
1.807
3.382
4.803
1.140
4.954
2.648
0.993
3.662
2.500
3.793
1.613
2.629
2.305
1.572
1.057
1.697
3.131
2.099
2.971
7.071
4.354
3.360
3.456
1.420
2.774
1.197
0.905
1.869
2.410
1.594
3.669
1.743
1.654
2.524
3.408
6.392
1.238
3.816
2.860
1.211
3.356
2.473
3.012
1.473
2.164
1.746
1.512
1.362
1.835
2.472
2.260
3.635
7.229
4.365
3.248
3.305
1.252
3.377
1.354
0.978
1.847
2.152
1.608
3.645
1.770
1.480
2.472
3.736
6.805
1.138
3.397
2.960
1.221
3.085
2.297
2.524
1.544
1.867
1.601
1.313
1.370
1.767
1.952
2.208
3.808
7.284
4.501
3.274
2.977
1.283
3.390
1.437
1.083
1.968
2.066
1.641
3.942
1.915
1.196
2.615
4.010
8.089
1.270
4.522
3.999
1.080
3.212
2.358
2.602
1.634
1.736
1.704
1.373
1.366
2.159
1.863
2.368
4.253
8.823
6.355
3.300
3.034
1.418
4.076
1.230
1.216
2.045
2.065
1.850
4.507
1.819
1.147
3.113
3.342
3.666
1.182
3.412
3.125
1.041
2.151
1.694
1.953
1.151
1.376
1.315
1.098
1.038
1.815
1.675
2.187
3.790
5.086
3.914
3.056
2.369
1.218
2.835
1.186
0.956
1.866
1.697
1.404
3.582
1.483
0.957
2.600
3.244
2.802
1.739
3.617
2.164
1.107
2.249
2.098
1.740
1.205
1.380
1.243
1.131
1.134
1.882
2.712
2.628
3.934
3.187
2.315
3.559
2.123
1.371
2.394
1.569
1.146
1.562
1.512
1.392
3.869
1.460
0.988
2.355
2.920
2.678
1.986
4.318
1.509
1.155
2.100
1.904
1.954
1.163
1.307
1.203
1.513
1.341
1.961
1.781
2.398
4.312
2.803
1.254
3.282
2.199
1.166
2.029
1.527
1.359
1.548
1.454
1.382
4.099
1.843
1.058
2.695
3.172
5.174
1.822
6.240
1.718
1.375
3.134
2.303
2.752
1.414
1.594
1.463
1.686
1.222
2.213
1.971
2.556
4.681
3.973
1.545
3.559
2.689
1.294
2.245
1.485
1.813
2.103
1.757
1.760
5.482
1.872
0.941
4.190
6.0 %
8.3
0.9
6.2
1.9
11.3
3.3
1.0
4.0
1.2
2.0
2.2
1.1
(2.2)
4.6
3.3
6.6
4.9
2.1
0.2
3.8
3.7
3.1
1.2
0.3
10.5
7.0
2.9
3.4
6.1
0.1
(1.5)
8.3
Page 26 of 49
2005
2006
2007
2008
2009*
CAGR
(2005 - 2008)
Albuquerque
Anaheim
Atlanta
Austin
Baltimore
Boston
Buffalo
Charlotte
Chicago
Cincinnati
Cleveland
Columbia
Dallas
Dayton
Denver
Detroit
Fort Lauderdale
Greensboro
Hartford
Houston
Huntsville
Indianapolis
Jacksonville
Kansas City
Las Vegas
Long Island
Los Angeles
Memphis
Miami
Milwaukee
Minneapolis
Nashville
New Haven
0.549
1.761
1.085
1.075
1.758
2.328
0.581
0.811
1.698
0.710
0.458
0.925
1.015
0.457
1.058
0.564
1.698
0.639
0.786
1.067
0.644
0.906
1.473
0.648
2.669
1.915
2.142
0.739
2.653
0.687
1.138
0.919
0.813
0.702
2.087
1.338
1.636
1.890
2.623
0.741
1.203
2.418
0.844
0.708
0.998
1.305
0.522
1.517
0.727
2.027
0.769
0.793
1.272
0.704
1.098
1.466
0.817
2.435
1.800
2.378
0.946
2.789
0.962
1.345
1.310
0.847
0.673
1.991
1.159
1.736
1.638
3.162
0.827
1.306
2.563
0.755
0.679
0.939
1.191
0.398
1.614
0.614
1.769
0.617
0.726
1.311
0.799
0.965
1.301
0.762
2.639
1.757
2.646
0.890
3.454
0.858
1.255
1.248
0.865
0.666
1.683
0.907
1.723
1.237
2.750
0.897
1.121
2.052
0.717
0.485
0.882
1.093
0.325
1.573
0.492
1.420
0.334
0.566
1.578
0.721
0.795
0.955
0.650
1.862
1.522
2.328
0.676
3.042
0.830
1.092
1.039
0.800
0.516
1.539
0.681
1.522
0.997
2.527
0.709
1.003
1.522
0.675
0.321
0.970
0.930
0.183
1.453
0.194
1.151
0.180
0.432
1.769
0.697
0.635
0.781
0.546
1.317
1.450
1.772
0.562
2.291
0.695
0.914
0.863
0.657
6.7 %
(1.5)
(5.8)
17.0
(11.0)
5.7
15.6
11.4
6.5
0.3
2.0
(1.6)
2.5
(10.8)
14.1
(4.4)
(5.8)
(19.5)
(10.4)
13.9
3.8
(4.3)
(13.4)
0.1
(11.3)
(7.4)
2.8
(2.9)
4.7
6.5
(1.3)
4.2
(0.6)
*Forecast
Page 27 of 49
Market
2005
2006
2007
2008
2009*
CAGR
(2005 - 2008)
New Orleans
New York
Norfolk
Oahu
Oakland
Omaha
Orlando
Philadelphia
Phoenix
Pittsburgh
Portland
Raleigh-Durham
Richmond
Rochester
Sacramento
Salt Lake City
San Antonio
San Diego
San Francisco
San Jose
Santa Fe
Seattle
St. Louis
Stamford
Syracuse
Tallahassee
Tampa
Tucson
United States
Washington, D.C.
Wilmington
Winston-Salem
WPB-Boca Raton
1.694
3.857
0.780
4.190
0.950
0.751
1.446
1.247
1.626
0.705
1.005
0.714
0.854
0.622
1.065
1.178
1.405
2.337
2.484
1.077
1.782
1.541
0.687
1.159
0.783
0.891
1.149
1.147
1.000
3.158
0.913
0.550
2.318
1.412
4.632
0.809
4.318
1.225
1.021
1.540
1.458
2.084
1.078
1.357
0.993
0.992
0.944
1.329
1.564
1.709
2.810
2.930
1.604
1.858
2.125
0.772
1.326
0.779
0.873
1.251
1.459
1.214
2.932
1.141
0.718
2.350
0.850
6.127
0.786
4.014
1.261
0.931
1.392
1.417
1.868
1.033
1.414
0.993
1.023
0.939
1.012
1.526
1.476
2.646
3.479
1.725
1.678
2.085
0.776
1.267
0.802
0.567
1.015
1.354
1.154
3.213
1.137
0.767
1.817
1.026
5.590
0.473
3.391
1.006
0.864
1.141
1.191
1.360
1.150
1.428
0.824
0.792
0.796
0.812
1.378
1.454
2.345
3.639
1.562
1.378
1.903
0.668
0.906
0.742
0.290
0.729
1.002
0.985
2.993
0.835
0.589
1.293
0.730
4.040
0.408
2.641
0.947
0.635
0.784
0.913
0.948
1.069
1.502
0.661
0.635
0.632
0.623
1.419
1.327
2.160
2.925
1.444
1.256
1.647
0.643
0.699
0.599
0.150
0.580
0.718
0.669
3.292
0.653
0.517
1.708
(15.4) %
13.2
(15.3)
(6.8)
1.9
4.8
(7.6)
(1.5)
(5.8)
17.7
12.4
4.9
(2.5)
8.6
(8.6)
5.4
1.1
0.1
13.6
13.2
(8.2)
7.3
(1.0)
(7.9)
(1.8)
(31.2)
(14.0)
(4.4)
(0.5)
(1.8)
(2.9)
2.3
(17.7)
*Forecast
Page 28 of 49
The tables on the following two pages exhibit per-room values for 65 HVI
markets and the United States as a whole for the past ten years, as well as
forecasts for 2009. The subsequent table illustrates the annual percentage
change in per-room hotel values by market for the corresponding ten-year
period, as well as our forecasts for 2009.
Page 29 of 49
1999
$34,974
$58,895
$83,663
$89,815
$102,961
$254,985
$47,885
$69,048
$149,462
$54,016
$60,738
$40,756
$90,504
$39,482
$81,349
$72,035
$82,473
$50,580
$75,254
$63,417
$24,595
$53,743
$66,634
$57,373
$115,764
$147,947
$99,826
$46,909
$123,183
$45,254
$77,736
$63,904
$70,977
2000
$38,666
$79,057
$83,411
$110,318
$121,844
$294,185
$50,302
$58,159
$153,012
$50,524
$57,360
$41,202
$93,063
$39,897
$86,532
$76,612
$87,215
$53,068
$87,904
$68,232
$25,880
$64,728
$73,098
$55,743
$149,201
$191,030
$121,974
$39,724
$127,063
$49,100
$85,022
$60,351
$81,318
2001
$33,735
$80,528
$64,091
$73,192
$107,204
$192,981
$41,850
$36,808
$98,928
$34,265
$38,590
$36,028
$58,014
$30,502
$66,171
$53,397
$76,048
$41,063
$74,106
$69,332
$23,924
$57,629
$65,977
$47,274
$127,738
$167,788
$91,847
$33,197
$88,231
$36,079
$65,974
$45,854
$74,449
2002
$37,160
$73,193
$59,731
$57,187
$123,258
$164,351
$43,665
$39,166
$89,773
$39,381
$34,054
$44,069
$53,852
$34,231
$58,795
$42,076
$65,046
$46,266
$65,624
$63,594
$35,890
$58,727
$73,561
$46,964
$136,322
$145,998
$87,693
$36,501
$61,139
$40,102
$62,582
$51,430
$75,800
2003
$35,387
$84,051
$49,752
$49,457
$124,368
$113,885
$39,900
$37,938
$91,704
$42,413
$28,980
$43,618
$44,623
$38,720
$51,435
$34,374
$79,308
$49,791
$51,047
$45,977
$37,544
$58,126
$87,015
$36,789
$186,071
$139,047
$91,410
$34,996
$78,334
$41,753
$54,126
$57,887
$62,308
2004
$36,946
$107,174
$64,808
$52,819
$137,059
$161,193
$37,309
$44,908
$99,635
$51,302
$36,487
$60,162
$56,136
$35,102
$62,292
$40,352
$117,647
$48,776
$68,931
$53,846
$42,287
$70,799
$99,867
$46,203
$230,238
$135,026
$135,858
$44,765
$130,820
$44,943
$70,622
$67,248
$67,156
2005
$45,217
$145,116
$89,429
$88,635
$144,893
$191,839
$47,858
$66,847
$139,927
$58,503
$37,727
$76,212
$83,651
$37,700
$87,188
$46,488
$139,944
$52,685
$64,780
$87,937
$53,089
$74,703
$121,379
$53,409
$219,981
$157,853
$176,545
$60,878
$218,624
$56,598
$93,768
$75,762
$67,045
2006
$57,895
$171,974
$110,279
$134,823
$155,774
$216,143
$61,070
$99,180
$199,281
$69,540
$58,334
$82,274
$107,541
$43,002
$125,017
$59,938
$167,085
$63,405
$65,363
$104,822
$58,017
$90,458
$120,795
$67,311
$200,721
$148,326
$195,953
$77,954
$229,841
$79,290
$110,882
$108,005
$69,832
2007
$55,461
$164,058
$95,560
$143,057
$135,025
$260,626
$68,133
$107,626
$211,197
$62,215
$55,960
$77,356
$98,141
$32,818
$133,025
$50,633
$145,824
$50,823
$59,826
$108,054
$65,874
$79,549
$107,255
$62,800
$217,532
$144,828
$218,043
$73,351
$284,700
$70,682
$103,412
$102,855
$71,321
2008
$54,872
$138,716
$74,731
$141,977
$101,990
$226,624
$73,932
$92,348
$169,090
$59,059
$39,983
$72,705
$90,090
$26,770
$129,677
$40,581
$117,021
$27,500
$46,658
$130,044
$59,437
$65,529
$78,747
$53,562
$153,473
$125,434
$191,842
$55,678
$250,704
$68,438
$90,032
$85,620
$65,918
2009*
$42,515
$126,823
$56,147
$125,435
$82,131
$208,250
$58,414
$82,648
$125,460
$55,603
$26,448
$79,907
$76,647
$15,064
$119,768
$15,975
$94,821
$14,849
$35,592
$145,800
$57,426
$52,351
$64,342
$44,979
$108,557
$119,524
$146,024
$46,351
$188,815
$57,281
$75,307
$71,124
$54,182
*Forecast
Page 30 of 49
1999
$139,498
$254,070
$42,499
$126,836
$110,513
$45,572
$115,179
$85,773
$94,231
$57,638
$69,717
$59,774
$49,017
$51,163
$65,960
$72,863
$82,448
$142,154
$271,955
$168,057
$122,233
$111,159
$47,889
$126,551
$53,668
$40,443
$73,473
$77,139
$61,250
$147,180
$71,483
$44,663
$97,628
2000
$149,722
$302,011
$47,422
$168,841
$149,283
$40,327
$119,916
$88,046
$97,128
$61,009
$64,832
$63,609
$51,268
$50,981
$80,608
$69,557
$88,426
$158,773
$329,386
$237,280
$123,190
$113,259
$52,942
$152,190
$45,939
$45,397
$76,345
$77,102
$69,067
$168,258
$67,930
$42,809
$116,230
2001
$124,788
$136,874
$44,118
$127,376
$116,660
$38,870
$80,289
$63,244
$72,902
$42,956
$51,382
$49,084
$40,994
$38,767
$67,773
$62,530
$81,668
$141,489
$189,867
$146,140
$114,109
$88,435
$45,475
$105,845
$44,276
$35,696
$69,662
$63,357
$52,434
$133,717
$55,352
$35,723
$97,068
2002
$121,111
$104,601
$64,909
$135,058
$80,774
$41,338
$83,957
$78,333
$64,967
$44,971
$51,507
$46,393
$42,230
$42,342
$70,257
$101,248
$98,128
$146,878
$118,992
$86,433
$132,872
$79,250
$51,170
$89,388
$58,587
$42,801
$58,318
$56,467
$51,957
$144,466
$54,517
$36,899
$87,906
2003
$109,029
$100,000
$74,136
$161,204
$56,330
$43,118
$78,405
$71,084
$72,971
$43,407
$48,790
$44,931
$56,478
$50,076
$73,228
$66,500
$89,526
$160,983
$104,638
$46,800
$122,540
$82,118
$43,529
$75,767
$57,017
$50,733
$57,775
$54,271
$51,585
$153,036
$68,806
$39,504
$100,625
2004
$118,427
$193,161
$68,034
$232,954
$64,150
$51,336
$117,011
$85,965
$102,744
$52,797
$59,515
$54,618
$62,938
$45,607
$82,629
$73,574
$95,421
$174,756
$148,312
$57,670
$132,861
$100,385
$48,326
$83,799
$55,439
$67,699
$78,525
$65,594
$65,719
$204,687
$69,890
$35,150
$156,444
2005
$139,591
$317,846
$64,271
$345,301
$78,321
$61,922
$119,138
$102,762
$134,047
$58,098
$82,845
$58,832
$70,403
$51,256
$87,785
$97,114
$115,818
$192,600
$204,703
$88,738
$146,826
$127,015
$56,650
$95,530
$64,491
$73,419
$94,663
$94,524
$82,416
$260,263
$75,247
$45,306
$191,032
2006
$116,410
$381,767
$66,653
$355,840
$101,001
$84,184
$126,905
$120,178
$171,765
$88,808
$111,838
$81,869
$81,727
$77,818
$109,524
$128,926
$140,853
$231,565
$241,497
$132,156
$153,127
$175,158
$63,603
$109,262
$64,163
$71,942
$103,107
$120,211
$100,065
$241,676
$94,036
$59,210
$193,650
2007
$70,038
$504,943
$64,740
$330,825
$103,950
$76,753
$114,726
$116,778
$153,951
$85,101
$116,575
$81,809
$84,309
$77,348
$83,371
$125,776
$121,609
$218,105
$286,710
$142,178
$138,278
$171,832
$63,960
$104,417
$66,123
$46,748
$83,652
$111,589
$95,117
$264,839
$93,704
$63,213
$149,733
2008
$84,577
$460,726
$38,986
$279,498
$82,923
$71,200
$94,039
$98,184
$112,058
$94,766
$117,696
$67,932
$65,273
$65,600
$66,933
$113,574
$119,859
$193,296
$299,916
$128,772
$113,587
$156,844
$55,030
$74,636
$61,133
$23,933
$60,110
$82,571
$81,196
$246,660
$68,845
$48,517
$106,551
2009*
$60,144
$333,002
$33,596
$217,696
$78,063
$52,351
$64,623
$75,220
$78,096
$88,136
$123,803
$54,455
$52,337
$52,128
$51,333
$116,922
$109,362
$178,008
$241,078
$119,040
$103,553
$135,704
$52,991
$57,649
$49,343
$12,368
$47,778
$59,195
$55,132
$271,326
$53,848
$42,585
$140,792
*Forecast
Page 31 of 49
1999
2000
2001
2002
2003
(13.5) %
1.1
2.6
0.5
10.5
5.3
8.4
(0.1)
0.2
(3.0)
(4.9)
1.3
(11.4)
(4.2)
(15.7)
15.0
8.5
(10.2)
18.5
(17.4)
22.6
(7.2)
(2.0)
(12.5)
7.4
23.7
8.0
(16.7)
15.5
0.2
(7.1)
(8.9)
12.8
10.6 %
34.2
(0.3)
22.8
18.3
15.4
5.0
(15.8)
2.4
(6.5)
(5.6)
1.1
2.8
1.1
6.4
6.4
5.8
4.9
16.8
7.6
5.2
20.4
9.7
(2.8)
28.9
29.1
22.2
(15.3)
3.1
8.5
9.4
(5.6)
14.6
(12.8) %
1.9
(23.2)
(33.7)
(12.0)
(34.4)
(16.8)
(36.7)
(35.3)
(32.2)
(32.7)
(12.6)
(37.7)
(23.6)
(23.5)
(30.3)
(12.8)
(22.6)
(15.7)
1.6
(7.6)
(11.0)
(9.7)
(15.2)
(14.4)
(12.2)
(24.7)
(16.4)
(30.6)
(26.5)
(22.4)
(24.0)
(8.4)
10.2 %
(9.1)
(6.8)
(21.9)
15.0
(14.8)
4.3
6.4
(9.3)
14.9
(11.8)
22.3
(7.2)
12.2
(11.1)
(21.2)
(14.5)
12.7
(11.4)
(8.3)
50.0
1.9
11.5
(0.7)
6.7
(13.0)
(4.5)
10.0
(30.7)
11.2
(5.1)
12.2
1.8
(4.8) %
14.8
(16.7)
(13.5)
0.9
(30.7)
(8.6)
(3.1)
2.2
7.7
(14.9)
(1.0)
(17.1)
13.1
(12.5)
(18.3)
21.9
7.6
(22.2)
(27.7)
4.6
(1.0)
18.3
(21.7)
36.5
(4.8)
4.2
(4.1)
28.1
4.1
(13.5)
12.6
(17.8)
2004
2005
2006
4.4 %
27.5
30.3
6.8
10.2
41.5
(6.5)
18.4
8.6
21.0
25.9
37.9
25.8
(9.3)
21.1
17.4
48.3
(2.0)
35.0
17.1
12.6
21.8
14.8
25.6
23.7
(2.9)
48.6
27.9
67.0
7.6
30.5
16.2
7.8
22.4 %
35.4
38.0
67.8
5.7
19.0
28.3
48.9
40.4
14.0
3.4
26.7
49.0
7.4
40.0
15.2
19.0
8.0
(6.0)
63.3
25.5
5.5
21.5
15.6
(4.5)
16.9
29.9
36.0
67.1
25.9
32.8
12.7
(0.2)
28.0 %
18.5
23.3
52.1
7.5
12.7
27.6
48.4
42.4
18.9
54.6
8.0
28.6
14.1
43.4
28.9
19.4
20.3
0.9
19.2
9.3
21.1
(0.5)
26.0
(8.8)
(6.0)
11.0
28.1
5.1
40.1
18.3
42.6
4.2
2007
2008
2009*
(4.2) %
(4.6)
(13.3)
6.1
(13.3)
20.6
11.6
8.5
6.0
(10.5)
(4.1)
(6.0)
(8.7)
(23.7)
6.4
(15.5)
(12.7)
(19.8)
(8.5)
3.1
13.5
(12.1)
(11.2)
(6.7)
8.4
(2.4)
11.3
(5.9)
23.9
(10.9)
(6.7)
(4.8)
2.1
(1.1) %
(15.4)
(21.8)
(0.8)
(24.5)
(13.0)
8.5
(14.2)
(19.9)
(5.1)
(28.6)
(6.0)
(8.2)
(18.4)
(2.5)
(19.9)
(19.8)
(45.9)
(22.0)
20.4
(9.8)
(17.6)
(26.6)
(14.7)
(29.4)
(13.4)
(12.0)
(24.1)
(11.9)
(3.2)
(12.9)
(16.8)
(7.6)
(22.5) %
(8.6)
(24.9)
(11.7)
(19.5)
(8.1)
(21.0)
(10.5)
(25.8)
(5.9)
(33.9)
9.9
(14.9)
(43.7)
(7.6)
(60.6)
(19.0)
(46.0)
(23.7)
12.1
(3.4)
(20.1)
(18.3)
(16.0)
(29.3)
(4.7)
(23.9)
(16.8)
(24.7)
(16.3)
(16.4)
(16.9)
(17.8)
*Forecast
Page 32 of 49
1999
2000
2001
2002
2003
2004
9.6 %
6.5
(8.1)
(11.0)
3.5
0.8
(8.1)
(7.1)
(16.2)
4.8
(13.7)
(8.3)
(13.1)
0.6
(3.7)
(21.1)
(2.3)
4.7
0.8
3.1
0.8
(9.9)
2.4
0.4
6.2
10.8
6.6
(4.0)
2.0
8.2
8.2
(19.2)
5.8
7.3 %
18.9
11.6
33.1
35.1
(11.5)
4.1
2.7
3.1
5.8
(7.0)
6.4
4.6
(0.4)
22.2
(4.5)
7.3
11.7
21.1
41.2
0.8
1.9
10.6
20.3
(14.4)
12.3
3.9
(0.0)
12.8
14.3
(5.0)
(4.2)
19.1
(16.7) %
(54.7)
(7.0)
(24.6)
(21.9)
(3.6)
(33.0)
(28.2)
(24.9)
(29.6)
(20.7)
(22.8)
(20.0)
(24.0)
(15.9)
(10.1)
(7.6)
(10.9)
(42.4)
(38.4)
(7.4)
(21.9)
(14.1)
(30.5)
(3.6)
(21.4)
(8.8)
(17.8)
(24.1)
(20.5)
(18.5)
(16.6)
(16.5)
(2.9) %
(23.6)
47.1
6.0
(30.8)
6.4
4.6
23.9
(10.9)
4.7
0.2
(5.5)
3.0
9.2
3.7
61.9
20.2
3.8
(37.3)
(40.9)
16.4
(10.4)
12.5
(15.5)
32.3
19.9
(16.3)
(10.9)
(0.9)
8.0
(1.5)
3.3
(9.4)
(10.0) %
(4.4)
14.2
19.4
(30.3)
4.3
(6.6)
(9.3)
12.3
(3.5)
(5.3)
(3.2)
33.7
18.3
4.2
(34.3)
(8.8)
9.6
(12.1)
(45.9)
(7.8)
3.6
(14.9)
(15.2)
(2.7)
18.5
(0.9)
(3.9)
(0.7)
5.9
26.2
7.1
14.5
8.6 %
93.2
(8.2)
44.5
13.9
19.1
49.2
20.9
40.8
21.6
22.0
21.6
11.4
(8.9)
12.8
10.6
6.6
8.6
41.7
23.2
8.4
22.2
11.0
10.6
(2.8)
33.4
35.9
20.9
27.4
33.8
1.6
(11.0)
55.5
2005
17.9 %
64.5
(5.5)
48.2
22.1
20.6
1.8
19.5
30.5
10.0
39.2
7.7
11.9
12.4
6.2
32.0
21.4
10.2
38.0
53.9
10.5
26.5
17.2
14.0
16.3
8.4
20.6
44.1
25.4
27.2
7.7
28.9
22.1
2006
2007
2008
2009*
(16.6) %
20.1
3.7
3.1
29.0
36.0
6.5
16.9
28.1
52.9
35.0
39.2
16.1
51.8
24.8
32.8
21.6
20.2
18.0
48.9
4.3
37.9
12.3
14.4
(0.5)
(2.0)
8.9
27.2
21.4
(7.1)
25.0
30.7
1.4
(39.8) %
32.3
(2.9)
(7.0)
2.9
(8.8)
(9.6)
(2.8)
(10.4)
(4.2)
4.2
(0.1)
3.2
(0.6)
(23.9)
(2.4)
(13.7)
(5.8)
18.7
7.6
(9.7)
(1.9)
0.6
(4.4)
3.1
(35.0)
(18.9)
(7.2)
(4.9)
9.6
(0.4)
6.8
(22.7)
20.8 %
(8.8)
(39.8)
(15.5)
(20.2)
(7.2)
(18.0)
(15.9)
(27.2)
11.4
1.0
(17.0)
(22.6)
(15.2)
(19.7)
(9.7)
(1.4)
(11.4)
4.6
(9.4)
(17.9)
(8.7)
(14.0)
(28.5)
(7.5)
(48.8)
(28.1)
(26.0)
(14.6)
(6.9)
(26.5)
(23.2)
(28.8)
(28.9) %
(27.7)
(13.8)
(22.1)
(5.9)
(26.5)
(31.3)
(23.4)
(30.3)
(7.0)
5.2
(19.8)
(19.8)
(20.5)
(23.3)
2.9
(8.8)
(7.9)
(19.6)
(7.6)
(8.8)
(13.5)
(3.7)
(22.8)
(19.3)
(48.3)
(20.5)
(28.3)
(32.1)
10.0
(21.8)
(12.2)
32.1
*Forecast
Page 33 of 49
The following table presents the 65 markets and the United States as a whole,
ranked in terms of their 2008 HVI. Each markets per-room value change as
both a dollar amount and a percentage change from 2007 are also provided.
Following the presentation of this data are pertinent observations for the
markets included in the HVI.
Percentage Change in Per-Room Values in 2008
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
Market
HVI
Index
Per-Room
Value
% Change
From 2007
New York
San Francisco
Oahu
Miami
Washington, D.C.
Boston
San Diego
Los Angeles
Chicago
Seattle
Las Vegas
Austin
Anaheim
Houston
Denver
San Jose
Long Island
San Antonio
Portland
Fort Lauderdale
Santa Fe
Salt Lake City
Phoenix
WPB-Boca Raton
Baltimore
Philadelphia
Pittsburgh
Orlando
Charlotte
Dallas
Minneapolis
Nashville
New Orleans
5.590
3.639
3.391
3.042
2.993
2.750
2.345
2.328
2.052
1.903
1.862
1.723
1.683
1.578
1.573
1.562
1.522
1.454
1.428
1.420
1.378
1.378
1.360
1.293
1.237
1.191
1.150
1.141
1.121
1.093
1.092
1.039
1.026
460,726
299,916
279,498
250,704
246,660
226,624
193,296
191,842
169,090
156,844
153,473
141,977
138,716
130,044
129,677
128,772
125,434
119,859
117,696
117,021
113,587
113,574
112,058
106,551
101,990
98,184
94,766
94,039
92,348
90,090
90,032
85,620
84,577
(8.8) %
4.6
(15.5)
(11.9)
(6.9)
(13.0)
(11.4)
(12.0)
(19.9)
(8.7)
(29.4)
(0.8)
(15.4)
20.4
(2.5)
(9.4)
(13.4)
(1.4)
1.0
(19.8)
(17.9)
(9.7)
(27.2)
(28.8)
(24.5)
(15.9)
11.4
(18.0)
(14.2)
(8.2)
(12.9)
(16.8)
20.8
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
Market
HVI
Index
Per-Room
Value
% Change
From 2007
Oakland
Tucson
United States
Jacksonville
Atlanta
Stamford
Buffalo
Columbia
Omaha
Wilmington
Milwaukee
Raleigh-Durham
Sacramento
New Haven
Rochester
Indianapolis
Richmond
Syracuse
Tampa
Huntsville
Cincinnati
Memphis
St. Louis
Albuquerque
Kansas City
Winston-Salem
Hartford
Detroit
Cleveland
Norfolk
Greensboro
Dayton
Tallahassee
1.006
1.002
0.985
0.955
0.907
0.906
0.897
0.882
0.864
0.835
0.830
0.824
0.812
0.800
0.796
0.795
0.792
0.742
0.729
0.721
0.717
0.676
0.668
0.666
0.650
0.589
0.566
0.492
0.485
0.473
0.334
0.325
0.290
$82,923
82,571
81,196
78,747
74,731
74,636
73,932
72,705
71,200
68,845
68,438
67,932
66,933
65,918
65,600
65,529
65,273
61,133
60,110
59,437
59,059
55,678
55,030
54,872
53,562
48,517
46,658
40,581
39,983
38,986
27,500
26,770
23,933
(20.2) %
(26.0)
(14.6)
(26.6)
(21.8)
(28.5)
8.5
(6.0)
(7.2)
(26.5)
(3.2)
(17.0)
(19.7)
(7.6)
(15.2)
(17.6)
(22.6)
(7.5)
(28.1)
(9.8)
(5.1)
(24.1)
(14.0)
(1.1)
(14.7)
(23.2)
(22.0)
(19.9)
(28.6)
(39.8)
(45.9)
(18.4)
(48.8)
Page 34 of 49
New York
2005
2006
2007
2008
2009
2010
2011
2012
2013
$317,846
64.5%
$381,767
20.1%
$504,943
32.3%
$460,726
-8.8%
$333,002
-27.7%
$304,030
-8.7%
$324,096
6.6%
$397,018
22.5%
$474,834
19.6%
New York, New York, has historically remained one of the top-ranked cities in
terms of per-room value in the United States. In addition to its status as the
financial capital of the United States, the city also benefits from a plethora of
leisure attractions. The markets response to downturns has been historically
typified by dramatic decreases and equally dramatic recoveries. Moreover,
New York has historically benefited from very strong underlying demand
fundamentals and a relatively limited room supply. However, New York
incurred a significant influx of new supply in 2008, with a sizable portion still
to come through 2010. Considering the latter, coupled with the impact of the
deepening recession, New York is anticipated to illustrate a continuously
downward trend through 2010. Thereafter, per-room value is expected to
progressively recover, matching its 2007 peak in 2014.
Historical and Projected San Francisco Per-Room Hotel Values
San Francisco
2005
2006
2007
2008
2009
2010
2011
2012
2013
$204,703
38.0%
$241,497
18.0%
$286,710
18.7%
$299,916
4.6%
$241,078
-19.6%
$265,540
10.1%
$259,519
-2.3%
$301,416
16.1%
$367,865
22.0%
San Francisco, California, has weathered the recession storm relatively well,
in comparison with other California markets. While San Francisco was one of
the few markets to post a per-room value increase in 2008, per-room value is
projected to decline notably in 2009. Value is then expected to partially
recover in 2010, due in part to an extremely limited amount of new supply.
The city benefits from a diversified economy based on high technology,
financial services, and tourism. Since 2004, when the national economy
recovered from the last downturn, San Francisco has posted strong increases
in marketwide demand and average rate year-over-year, up until the end of
2008.
Page 35 of 49
Oahu
2005
2006
2007
2008
2009
2010
2011
2012
2013
$345,301
48.2%
$355,840
3.1%
$330,825
-7.0%
$279,498
-15.5%
$217,696
-22.1%
$211,366
-2.9%
$238,248
12.7%
$273,626
14.8%
$334,200
22.1%
Oahu, Hawaii, was the subject of much unwanted press in 2008, due to
substantial declines in tourism and visitation stemming from reduced
discretionary spending in major American markets. Per-room values declined
by 15.5% in 2008; a more drastic decline is forecast for 2009. Considering its
strong demand fundamentals and lack of new supply in the pipeline, Oahus
per-room values are forecast to recover beginning in 2011.
Historical and Projected Miami Per-Room Hotel Values
Miami
2005
2006
2007
2008
2009
2010
2011
2012
2013
$218,624
67.1%
$229,841
5.1%
$284,700
23.9%
$250,704
-11.9%
$188,815
-24.7%
$189,122
0.2%
$214,150
13.2%
$246,318
15.0%
$313,124
27.1%
Washington, D.C.
2005
2006
2007
2008
2009
2010
2011
2012
2013
$260,263
27.2%
$241,676
-7.1%
$264,839
9.6%
$246,660
-6.9%
$271,326
10.0%
$312,024
15.0%
$355,708
14.0%
$401,950
13.0%
$450,184
12.0%
The federal government serves as the catalyst for all the economic activity in
the greater Washington, D.C., area, including the operations of hundreds of
private-sector firms, associations, trade unions, lawyers, defense companies,
political groups, and international organizations. The U.S. government is the
Page 36 of 49
Boston
2005
2006
2007
2008
2009
2010
2011
2012
2013
$191,839
19.0%
$216,143
12.7%
$260,626
20.6%
$226,624
-13.0%
$208,250
-8.1%
$216,834
4.1%
$254,659
17.4%
$295,447
16.0%
$375,121
27.0%
San Diego
2005
2006
2007
2008
2009
2010
2011
2012
2013
$192,600
10.2%
$231,565
20.2%
$218,105
-5.8%
$193,296
-11.4%
$178,008
-7.9%
$185,855
4.4%
$209,191
12.6%
$240,866
15.1%
$288,741
19.9%
Page 37 of 49
new supply entered the market in the past 18 months. The city is poised to
recover before most other markets, returning to peak levels achieved in 2006
by 2012.
Historical and Projected Los Angeles Per-Room Hotel Values
Los Angeles
2005
2006
2007
2008
2009
2010
2011
2012
2013
$176,545
29.9%
$195,953
11.0%
$218,043
11.3%
$191,842
-12.0%
$146,024
-23.9%
$136,813
-6.3%
$154,735
13.1%
$182,769
18.1%
$234,026
28.0%
Chicago
2005
2006
2007
2008
2009
2010
2011
2012
2013
$139,927
40.4%
$199,281
42.4%
$211,197
6.0%
$169,090
-19.9%
$125,460
-25.8%
$119,036
-5.1%
$141,962
19.3%
$172,014
21.2%
$212,639
23.6%
Seattle
2005
2006
2007
2008
2009
2010
2011
2012
2013
$127,015
26.5%
$175,158
37.9%
$171,832
-1.9%
$156,844
-8.7%
$135,704
-13.5%
$134,974
-0.5%
$169,259
25.4%
$201,069
18.8%
$247,795
23.2%
Page 38 of 49
Seattle, Washington, benefits from its diverse economic base, with such major
companies as Starbucks, Nordstrom, and Microsoft headquartered in the
area. As a result of the impact of the national recession, this markets perroom value posted a decline in 2008, and this trend is expected to continue
through 2009. However, considering the citys relatively strong demand base,
per-room value is expected to recover fully and surpass its 2006 peak in 2012.
Remaining HVI Markets
The following tables present historical and projected per-room values for the
remaining 55 HVI markets.
Page 39 of 49
2005
2006
2007
2008
2009
2010
2011
2012
2013
$45,217
22.4%
$57,895
28.0%
$55,461
-4.2%
$54,872
-1.1%
$42,515
-22.5%
$37,661
-11.4%
$38,780
3.0%
$46,937
21.0%
$56,288
19.9%
$145,116
35.4%
$171,974
18.5%
$164,058
-4.6%
$138,716
-15.4%
$126,823
-8.6%
$136,485
7.6%
$158,766
16.3%
$179,983
13.4%
$211,249
17.4%
(1.5)
Atlanta
$89,429
38.0%
$110,279
23.3%
$95,560
-13.3%
$74,731
-21.8%
$56,147
-24.9%
$46,806
-16.6%
$61,066
30.5%
$81,303
33.1%
$110,392
35.8%
(5.8)
Austin
$88,635
67.8%
$134,823
52.1%
$143,057
6.1%
$141,977
-0.8%
$125,435
-11.7%
$136,617
8.9%
$169,070
23.8%
$201,919
19.4%
$209,182
3.6%
17.0
$144,893
5.7%
$155,774
7.5%
$135,025
-13.3%
$101,990
-24.5%
$82,131
-19.5%
$75,010
-8.7%
$92,136
22.8%
$110,605
20.0%
$144,107
30.3%
(11.0)
Buffalo
$47,858
28.3%
$61,070
27.6%
$68,133
11.6%
$73,932
8.5%
$58,414
-21.0%
$53,003
-9.3%
$64,044
20.8%
$77,298
20.7%
$96,293
24.6%
15.6
Charlotte
$66,847
48.9%
$99,180
48.4%
$107,626
8.5%
$92,348
-14.2%
$82,648
-10.5%
$88,931
7.6%
$110,819
24.6%
$130,498
17.8%
$157,540
20.7%
11.4
Cincinnati
$58,503
14.0%
$69,540
18.9%
$62,215
-10.5%
$59,059
-5.1%
$55,603
-5.9%
$60,963
9.6%
$74,253
21.8%
$85,314
14.9%
$102,853
20.6%
0.3
Cleveland
$37,727
3.4%
$58,334
54.6%
$55,960
-4.1%
$39,983
-28.6%
$26,448
-33.9%
$23,618
-10.7%
$33,758
42.9%
$47,084
39.5%
$61,786
31.2%
2.0
Columbia
$76,212
26.7%
$82,274
8.0%
$77,356
-6.0%
$72,705
-6.0%
$79,907
9.9%
$93,331
16.8%
$111,190
19.1%
$129,170
16.2%
$155,874
20.7%
(1.6)
Dallas
$83,651
49.0%
$107,541
28.6%
$98,141
-8.7%
$90,090
-8.2%
$76,647
-14.9%
$76,889
0.3%
$90,114
17.2%
$105,810
17.4%
$136,175
28.7%
2.5
Dayton
$37,700
7.4%
$43,002
14.1%
$32,818
-23.7%
$26,770
-18.4%
$15,064
-43.7%
$6,747
-55.2%
$7,582
12.4%
$14,393
89.8%
$28,913
100.9%
(10.8)
Albuquerque
Anaheim
Baltimore
2.8 %
Page 40 of 49
2005
2006
2007
2008
2009
2010
2011
2012
2013
Denver
$87,188
40.0%
$125,017
43.4%
$133,025
6.4%
$129,677
-2.5%
$119,768
-7.6%
$125,213
4.5%
$153,475
22.6%
$177,679
15.8%
$213,511
20.2%
14.1
Detroit
$46,488
15.2%
$59,938
28.9%
$50,633
-15.5%
$40,581
-19.9%
$15,975
-60.6%
$5,431
-66.0%
$5,157
-5.0%
$13,438
160.6%
$27,496
104.6%
(4.4)
$139,944
19.0%
$167,085
19.4%
$145,824
-12.7%
$117,021
-19.8%
$94,821
-19.0%
$85,105
-10.2%
$100,419
18.0%
$122,636
22.1%
$158,441
29.2%
(5.8)
Greensboro
$52,685
8.0%
$63,405
20.3%
$50,823
-19.8%
$27,500
-45.9%
$14,849
-46.0%
$530
-96.4%
$4,779
802.4%
$15,274
219.6%
$33,150
117.0%
(19.5)
Hartford
$64,780
-6.0%
$65,363
0.9%
$59,826
-8.5%
$46,658
-22.0%
$35,592
-23.7%
$23,705
-33.4%
$30,465
28.5%
$42,222
38.6%
$62,754
48.6%
(10.4)
Houston
$87,937
63.3%
$104,822
19.2%
$108,054
3.1%
$130,044
20.4%
$145,800
12.1%
$160,371
10.0%
$189,917
18.4%
$211,961
11.6%
$245,839
16.0%
13.9
Huntsville
$53,089
25.5%
$58,017
9.3%
$65,874
13.5%
$59,437
-9.8%
$57,426
-3.4%
$56,771
-1.1%
$72,270
27.3%
$88,563
22.5%
$109,936
24.1%
3.8
Indianapolis
$74,703
5.5%
$90,458
21.1%
$79,549
-12.1%
$65,529
-17.6%
$52,351
-20.1%
$43,510
-16.9%
$51,118
17.5%
$60,266
17.9%
$76,648
27.2%
(4.3)
Jacksonville
$121,379
21.5%
$120,795
-0.5%
$107,255
-11.2%
$78,747
-26.6%
$64,342
-18.3%
$58,108
-9.7%
$70,251
20.9%
$81,801
16.4%
$101,893
24.6%
(13.4)
Kansas City
$53,409
15.6%
$67,311
26.0%
$62,800
-6.7%
$53,562
-14.7%
$44,979
-16.0%
$36,311
-19.3%
$44,515
22.6%
$55,356
24.4%
$72,297
30.6%
0.1
Las Vegas
$219,981
-4.5%
$200,721
-8.8%
$217,532
8.4%
$153,473
-29.4%
$108,557
-29.3%
$86,677
-20.2%
$72,584
-16.3%
$71,921
-0.9%
$97,920
36.1%
(11.3)
Long Island
$157,853
16.9%
$148,326
-6.0%
$144,828
-2.4%
$125,434
-13.4%
$119,524
-4.7%
$108,187
-9.5%
$130,494
20.6%
$153,469
17.6%
$184,590
20.3%
(7.4)
Fort Lauderdale
Page 41 of 49
2005
2006
2007
2008
2009
2010
2011
2012
2013
Memphis
$60,878
36.0%
$77,954
28.1%
$73,351
-5.9%
$55,678
-24.1%
$46,351
-16.8%
$41,672
-10.1%
$53,183
27.6%
$66,842
25.7%
$88,328
32.1%
(2.9)
Milwaukee
$56,598
25.9%
$79,290
40.1%
$70,682
-10.9%
$68,438
-3.2%
$57,281
-16.3%
$53,101
-7.3%
$66,860
25.9%
$80,473
20.4%
$96,861
20.4%
6.5
Minneapolis
$93,768
32.8%
$110,882
18.3%
$103,412
-6.7%
$90,032
-12.9%
$75,307
-16.4%
$81,155
7.8%
$100,499
23.8%
$122,082
21.5%
$152,525
24.9%
(1.3)
Nashville
$75,762
12.7%
$108,005
42.6%
$102,855
-4.8%
$85,620
-16.8%
$71,124
-16.9%
$68,872
-3.2%
$87,986
27.8%
$106,353
20.9%
$132,631
24.7%
4.2
New Haven
$67,045
-0.2%
$69,832
4.2%
$71,321
2.1%
$65,918
-7.6%
$54,182
-17.8%
$47,947
-11.5%
$59,388
23.9%
$72,640
22.3%
$94,206
29.7%
(0.6)
New Orleans
$139,591
17.9%
$116,410
-16.6%
$70,038
-39.8%
$84,577
20.8%
$60,144
-28.9%
$51,144
-15.0%
$69,190
35.3%
$91,985
32.9%
$127,253
38.3%
(15.4) %
Norfolk
$64,271
-5.5%
$66,653
3.7%
$64,740
-2.9%
$38,986
-39.8%
$33,596
-13.8%
$31,251
-7.0%
$36,931
18.2%
$45,903
24.3%
$62,371
35.9%
(15.3)
Oakland
$78,321
22.1%
$101,001
29.0%
$103,950
2.9%
$82,923
-20.2%
$78,063
-5.9%
$78,347
0.4%
$94,676
20.8%
$110,744
17.0%
$136,453
23.2%
1.9
Omaha
$61,922
20.6%
$84,184
36.0%
$76,753
-8.8%
$71,200
-7.2%
$52,351
-26.5%
$43,107
-17.7%
$55,011
27.6%
$70,639
28.4%
$94,751
34.1%
4.8
Orlando
$119,138
1.8%
$126,905
6.5%
$114,726
-9.6%
$94,039
-18.0%
$64,623
-31.3%
$54,095
-16.3%
$68,136
26.0%
$85,483
25.5%
$113,692
33.0%
(7.6)
Philadelphia
$102,762
19.5%
$120,178
16.9%
$116,778
-2.8%
$98,184
-15.9%
$75,220
-23.4%
$67,461
-10.3%
$81,740
21.2%
$101,504
24.2%
$133,731
31.7%
(1.5)
Phoenix
$134,047
30.5%
$171,765
28.1%
$153,951
-10.4%
$112,058
-27.2%
$78,096
-30.3%
$61,523
-21.2%
$82,637
34.3%
$107,935
30.6%
$146,296
35.5%
(5.8)
Page 42 of 49
2005
2006
2007
2008
2009
2010
2011
2012
2013
Pittsburgh
$58,098
10.0%
$88,808
52.9%
$85,101
-4.2%
$94,766
11.4%
$88,136
-7.0%
$89,770
1.9%
$109,047
21.5%
$124,651
14.3%
$149,143
19.6%
17.7
Portland
$82,845
39.2%
$111,838
35.0%
$116,575
4.2%
$117,696
1.0%
$123,803
5.2%
$131,481
6.2%
$152,231
15.8%
$167,375
9.9%
$192,548
15.0%
12.4
Raleigh-Durham
$58,832
7.7%
$81,869
39.2%
$81,809
-0.1%
$67,932
-17.0%
$54,455
-19.8%
$45,687
-16.1%
$56,696
24.1%
$69,538
22.7%
$90,607
30.3%
4.9
Richmond
$70,403
11.9%
$81,727
16.1%
$84,309
3.2%
$65,273
-22.6%
$52,337
-19.8%
$47,402
-9.4%
$58,167
22.7%
$69,858
20.1%
$90,391
29.4%
(2.5)
Rochester
$51,256
12.4%
$77,818
51.8%
$77,348
-0.6%
$65,600
-15.2%
$52,128
-20.5%
$43,119
-17.3%
$55,615
29.0%
$70,784
27.3%
$94,685
33.8%
8.6
Sacramento
$87,785
6.2%
$109,524
24.8%
$83,371
-23.9%
$66,933
-19.7%
$51,333
-23.3%
$41,194
-19.8%
$54,219
31.6%
$68,995
27.3%
$89,100
29.1%
(8.6)
$97,114
32.0%
$128,926
32.8%
$125,776
-2.4%
$113,574
-9.7%
$116,922
2.9%
$119,496
2.2%
$134,590
12.6%
$152,364
13.2%
$179,979
18.1%
5.4
San Antonio
$115,818
21.4%
$140,853
21.6%
$121,609
-13.7%
$119,859
-1.4%
$109,362
-8.8%
$99,292
-9.2%
$109,566
10.3%
$127,254
16.1%
$155,233
22.0%
1.1
San Jose
$88,738
53.9%
$132,156
48.9%
$142,178
7.6%
$128,772
-9.4%
$119,040
-7.6%
$119,276
0.2%
$148,224
24.3%
$175,684
18.5%
$216,924
23.5%
13.2
Santa Fe
$146,826
10.5%
$153,127
4.3%
$138,278
-9.7%
$113,587
-17.9%
$103,553
-8.8%
$91,691
-11.5%
$110,760
20.8%
$130,841
18.1%
$161,800
23.7%
(8.2)
St. Louis
$56,650
17.2%
$63,603
12.3%
$63,960
0.6%
$55,030
-14.0%
$52,991
-3.7%
$52,545
-0.8%
$64,883
23.5%
$78,865
21.5%
$101,476
28.7%
(1.0)
Stamford
$95,530
14.0%
$109,262
14.4%
$104,417
-4.4%
$74,636
-28.5%
$57,649
-22.8%
$46,403
-19.5%
$61,478
32.5%
$76,665
24.7%
$97,897
27.7%
(7.9)
Page 43 of 49
CAGR
(2005 - 2013)
2005
2006
2007
2008
2009
2010
2011
2012
2013
Syracuse
$64,491
16.3%
$64,163
-0.5%
$66,123
3.1%
$61,133
-7.5%
$49,343
-19.3%
$43,843
-11.1%
$51,246
16.9%
$60,032
17.1%
$75,948
26.5%
(1.8)
Tallahassee
$73,419
8.4%
$71,942
-2.0%
$46,748
-35.0%
$23,933
-48.8%
$12,368
-48.3%
$842
-93.2%
$3,704
339.9%
$12,252
230.7%
$27,581
125.1%
(31.2)
Tampa
$94,663
20.6%
$103,107
8.9%
$83,652
-18.9%
$60,110
-28.1%
$47,778
-20.5%
$41,869
-12.4%
$55,735
33.1%
$76,043
36.4%
$107,402
41.2%
(14.0)
Tucson
$94,524
44.1%
$120,211
27.2%
$111,589
-7.2%
$82,571
-26.0%
$59,195
-28.3%
$51,886
-12.3%
$65,886
27.0%
$83,381
26.6%
$111,694
34.0%
(4.4)
Wilmington
$75,247
7.7%
$94,036
25.0%
$93,704
-0.4%
$68,845
-26.5%
$53,848
-21.8%
$44,879
-16.7%
$49,423
10.1%
$64,307
30.1%
$88,719
38.0%
(2.9)
Winston-Salem
$45,306
28.9%
$59,210
30.7%
$63,213
6.8%
$48,517
-23.2%
$42,585
-12.2%
$38,626
-9.3%
$49,466
28.1%
$62,158
25.7%
$82,149
32.2%
2.3
$191,032
22.1%
$193,650
1.4%
$149,733
-22.7%
$106,551
-28.8%
$140,792
32.1%
$169,903
20.7%
$204,020
20.1%
$227,723
11.6%
$253,079
11.1%
WPB-Boca Raton
Page 44 of 49
Conclusion
Over the past twelve months, the deepening economic recession has had a
profound impact on hotel values. Not only have weakened demand levels
contributed to this trend, but the veritable evaporation of credit has also
contributed significantly. Generally, hotel values are projected to bottom out
in 2010. With near-term depressed earnings for hotels, and the reality of
making a purchase with all cash or a low loan-to-value ratio, HVSs new
valuation methodology assumes that purchasers will look to refinance the
hotel once its earnings have recovered and the credit markets have returned
to some semblance of normalcy. Based on the economic and financial trends
described throughout this report, hotel values are expected to recover over a
five-year period, matching or surpassing peak levels recorded in 2006 by
2013-2014. Real Capital Analytics estimates that approximately $18 billion in
hotel loans were distressed as of August 2009. Capital market participants are
expected to either foreclose on such assets or restructure and work out their
loan requirements. Considering such factors, savvy investors with access to
equity are expected to capitalize on such opportunities and purchase
distressed assets with an upside, at significantly discounted prices. Thus, over
the next 12 to 18 months, the volume of hotel sales transactions is expected to
illustrate a progressively upward trend.
Page 45 of 49
Page 46 of 49
within the broader market, can cause that submarket to have significantly
different results than the market as a whole.
Numerous factors influence the value of an individual asset, including the
propertys age, condition, location, amenities and services, brand,
management expertise, and reputation. All of these factors must be
considered in the context of the hotels specific competitive market, including
the nature, strength, and trends in demand generators, the character and
competitive posture of the existing hotels, and the potential addition of any
new properties. The value of any individual asset can only be concluded after
a thorough investigation of all these factors. And that conclusion will
invariably differ often materially from the index indicated by the HVI.
So how can the HVI be of use to an individual investor? Although the HVI
cannot tell you what a particular hotel is worth, it does provide excellent big
picture data, indicating which market areas are experiencing positive trends
and thus may present good investment opportunities. The HVI for the U.S. is
a measure of the strength of the lodging industry as a whole and, specifically,
the hospitality investment market. The HVI for the various identified markets
can provide a basis to evaluate and compare different geographic regions.
Page 47 of 49
Page 48 of 49
Emily U. Smith is a Vice President of the New York office of HVS. Since
joining HVS in June 2007, Ms. Smith has worked on roughly 100 consulting
and valuation assignments in 19 states. In addition to appraisals, she has
performed feasibility and market studies, as well as litigation support services
and competitive market analyses. She has published three articles pertaining
to development, valuation, and lodging trends, and she has also been
interviewed by Commercial Property News. Her article on the Japanese lodging
industry was published in the Fall 2008 Real Estate Finance Journal.
Ms. Smith received a Bachelor of Arts degree from Tulane University,
graduating summa cum laude with a dual major in History and French. She
holds a Master of Science in Hospitality Management from the Conrad N.
Hilton College of Hotel & Restaurant Management at the University of
Houston. She also has two years of overseas work experience in Kyoto, Japan.
Ms. Smith was recently selected as the recipient of the 2009 Distinguished
Young Alumnus Award by the Conrad N. Hilton College.
Contact information for Emily Smith:
Phone: 516-248-8828 x277
Fax: 516-742-3059
Email: esmith@hvs.com
Neel M. Lund is a Vice President at HVS New York. Since joining HVS in
June 2007, he has provided consulting and appraisal services for over 100
assignments in the United States. Neel specializes in the New York City
lodging market and has worked on more than 50 assignments within this
market area alone. His industry expertise includes market studies, feasibility
analyses, appraisals, and development consulting. Neels previous
publications include articles on topics relating to hotel front office upsell
programs and sport tourism. He also co-authored the 2008 publication of the
Hotel Valuation Index (HVI).
Neel received his bachelors degree from Cornell Universitys School of
Industrial and Labor Relations, and also holds a post-graduate diploma in
International Hospitality Management from Les Roches, School of Hotel
Management, Bluche, Switzerland.
Contact information for Neel Lund:
Phone: 516-248-8828 x255
Fax: 516-742-3059
Email: nlund@hvs.com
Page 49 of 49